Redefining Banking in the Philippines

UnionBank of the Philippines is redefining banking in the Philippines. Focused on developing solutions that make banking more efficient, cost-effective and readily accessible for both retail and commercial clients. Global Banking & Finance Review spoke to Henry R. Aguda, Senior Executive Vice President, CTO and CTOO of Union Bank of the Philippines to find out more about what the bank is doing and their plans for the future.

How is Union Bank embracing the future of banking?

The greatest manifestation of how we are embracing the future of banking is our decision to embark on a digital transformation since 2016. We are “future-proofing” our enterprise by harnessing technology to make our core banking operations more accessible, efficient and customer-friendly, as well as by exploring new business models outside traditional banking.

What technological innovations has Union Bank pioneered?

• UnionBank has established many firsts in the Philippine banking industry, including the first bank website, online banking, the country’s first electronic savings account which is the EON Cyber Account. The EON program also brought the advent of electronic checking in the Philippines.
• In the last few years we also pioneered the first fully digital bank branch which we call The ARK, the first banking chatbot, the first selfie-banking in Asia, the first API platform – where fntechs can connect to the system functionalities of the bank and vice-versa.
• UnionBank also piloted robotics process automation to some of its internal processes and has seen processing time reduced by 80 to 90.
• We were also the first bank to implement blockchain technology into our internal processes and customers.

How is Union Bank supporting the nation’s push to be a G20 country by 2050?

• The bank has an advocacy called “Tech Up, Pilipinas” which aims to harness technology to promote financial inclusion for sustainable prosperity, particularly of the unbanked and the underserved who compose around half of the Philippines’ 109 million population.
• Through greater financial inclusion, we believe that we will have a bigger chance to realize our goal of becoming a G20 country by 2050.

What new digital innovations does UnionBank have in-store in order to remain competitive in 2020?

• The bank’s future projects are in line with its digital transformation strategy. Plan A aims to develop UnionBank into a fully-agile and digitally transformed organization. Hence, it shall continue to launch products and services that will enable the bank to increase efficiencies at the back-end while improving productivity and customer experience of its customer channels. Some of these include: applying further enhancements in in the UnionBank Online app and The Portal, launch more transformed branches (Arks), introduction of self-service branches, and automating more back-end and front-end processes.
• Plan C+ aims to develop its subsidiary CitySavings into a digitally-transformed mass market bank. With this, the bank aims to not only diversify into other mass market segments, such as motorcycle loans and MSME loans, but also digitizing processes with the help of technology and applying a shared services model across its other mass market subsidiaries of the bank.
• Lastly, Plan B is the bank’s hedge towards a future of embedded banking or token/digital asset economy. Apart from the i2i – our platform to connect rural banks and other financial institutions to the central bank – and SME B2B platform enhancements that it is currently working on, it plans to work on retail-focused marketplaces and platforms and continue its experimentations such as in areas of asset tokenization and fintech investments.

How important is sustainability to Union Bank?

As we aspire to be a bank of enduring greatness, we are also a leading proponent of sustainability.

In line with our digital transformation, we are also investing in relevant social and environment programs that benefit our stakeholders. This is how we contribute to sustainability.

For us at UnionBank, sustainability is something we have embraced as part of our overarching purpose and our accountability to our stakeholders. Our duty is to safeguard the future by ensuring an agile, secure, and customer-centric system, healthy gains, and an unbroken trust with our clients and partners. We strive to improve not only our profitability, but all aspects of our performance, including how we uplift society and protect the environment. This is embodied in our Sustainability Policy and our Sustainability Framework focused on People, Planet, and Purpose.

How do you use technology to create meaningful experiences for your customers?

As our president and CEO believes that excellent customer engagement is the key to a company’s growth and stability, UnionBank is committed to constantly seek ways to use technology to innovate and improve its products and services to ensure that it offers nothing but the best customer experience to all.

The bank is known for its culture of innovation – driven by strong experimentation among its team members.

How does Union Bank provide banking services to overseas Filipinos?

• UnionBank has what we call the Send-i2i platform that is intended to tackle pain points in cross-border remittances made by the over 10 million overseas Filipino workers.
• Send i2i’s concept and process was piloted at the Singapore Fintech Festival last November.Through blockchain technology, Send-i2i is envisioned to connect rural banks across the Philippines to a partner bank in Singapore to perform transborder remittances.
• Using PayNow QR and tokenized fiat, Send-i2i will boost customer experience with near real-time transactions at 50% less the cost. More importantly, it will champion financial inclusion for communities in the countryside who use rural banks as their go-to bank.